A credit score is a number ranging between 300 and 850 that helps a lender determine the repayment capability of a loan. The actual scores are usually between 300 and 850. Speaking of numbers, where does 700 fall? Should I feel proud of my credit score which is 700?
What Credit Scores Mean
Very Poor: 600-579 Given your low score, you will be easily rejected for credit cards and loans if you fall into the extremely bad level. Less than 1% of the population overall have scored less than 550.
Fair: 580–669 If you fall within the fair range, lenders might still be ready to authorize loans for you even if their interest rates are higher. About 17% of the population overall have credit ratings of less than 650.
Good: 650–739 Within the range of 700–850, a score of 700 may be regarded as a respectable one that falls on the brink of a good score. Once they reach this level, they most likely can borrow loans with affordable rates charged. You will still have to work a little however to raise your forward score. Of the people living in India, 60% reportedly have credit ratings of less than 750.
Very Good: 740–799 Significantly, scores in this range are considered to be excellent. From this, one may conclude that the greatest loan arrangements and practically the lowest possible interest rates will only be accessible to applicants with credit scores of 750 or above. Notably, about 79% of the population falls below 800 points.
Exceptional: 800–850 With just 0.6% of persons obtaining an outstanding credit score of 850, it is rather difficult for someone to do. Still, you will be able to negotiate the most beneficial loan conditions from the lenders even if your score is somewhat lower—between 800 and 850.
Is 700 Good Enough?
Yes, with 700, which is still considered a bad credit score, you will be able to borrow money for most of the stuff you could want at moderate interest rates. It’s just not going to be absolutely the very best of terms that could be offered to you. Here is a summary of what one can do with a credit score of 700:
- Mortgages – Should be able to negotiate for an FHA mortgage that ranges a minimum of 580 credit score or a conventional mortgage whose minimum score is 620. However, with a score of around 750, you will be receiving lower interest rates.
- Auto Loans - 700 is just the range up to which you will need to go to receive better interest rates. Those above 740 will be offered the best rates from most lenders.
- Credit Cards – Upon reaching 700, you will be eligible for most of the general credit cards that are marketed for people with good credit scores. You will likely be able to obtain rewards cards and cards with nice terms.
- Personal Loans – Online lenders and credit unions may give out personal loans, to individuals with a 700 credit score on average. It’s just to understand that you will have to pay more interest than a depositor with a score of 750 and above.
- Apartment Rental – This sector is one of the most common places where landlords are likely to review credit scores before permitting tenants to live in those spaces. While a 700 score means you are more likely to meet basic credit standards and meet the criteria of landlords who accept tenants with such scores.
Thus, 700 deems you not a contender for the lowest possible interest rates but still quite an impressive figure to have. Having a good credit score means something to those lending money that you are a prudent borrower who promptly pays his/her bills, and has a low credit utilization ratio.
It is also imperative to know how to improve from a 700 credit score as this will enable the user to have a pointer on what to do.
While 700 is respectable, there are still ways to improve your score and get even better loan terms: While 700 is respectable, there are still ways to improve your score and get even better loan terms:
- Use credit cards responsibly – Ensure that one does not have high credit card utilization ratios. The following tips will help when managing your finances: Use cash for all purchases whenever possible and pay your bill in full every month.
- The more diverse credit – This means that one has to have credit cards, car loans, mortgages, etc on their credit report. Variety helps.
- Applying for only the credit you require – Every time one applies, the score decreases slightly. Do not apply to several credit facilities concurrently.
- Credit report – Get a copy of all three and analyze and dispute any wrong entries that are likely to reduce your score.
- Monitor and minimize late payments – One can make payments automatically to avoid missing them and ask for reminders. You could see your score fall by 100 points or even more if you allow one 30-day late slip-through.
While it requires time and effort on the credit improvement plan, the approach that works is a several-step one, and it is fully possible to achieve a credit score higher than 750 in a year and a half.
The Takeaway
A score of 700 is well above average, it suggests that the holder is punctual in paying back debts and is responsible in handling credit. It makes you qualified for most of the loans and attractive interest rates but outstanding terms remain unachievable. This means that anything above 750 is deemed to be very good to exceptional. For someone with a credit score of 700 or higher, credit is already available to you, but improving it will make you eligible for the lowest interest rates and the best loan terms.
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